The commercial real estate market operates slightly differently than the residential market. If this is your first commercial real estate transaction, there are a few things you should know. Following these recommendations can help you make a better purchase decision.
Hire an Attorney
Some states require an attorney for every real estate transaction, but Texas is not one of them. However, hiring a commercial real estate attorney Austin TX can help you handle due diligence for the property. They can craft the purchase agreement, handle the title insurance and ensure all the legal documents are properly reviewed. The last thing you want is to sign something you do not fully understand. An attorney can help remove ambiguity and help you avoid surprises.
Obtain Estoppel Certificates
If you buy a property that already has tenants, make sure you obtain the estoppel certificates from the tenants. These certificates are essential to making sure the prior landlord upheld their agreement. You also can learn what is required of you from these certificates such as HVAC maintenance or parking lot upgrades. Even if you have to wait for the certificates, it is wise to do so.
Close When Ready
Avoid rushing the closing until you are ready. Don’t allow the seller to bully you into closing early. You want to make sure your attorney has looked over all the agreements and documents and that you have obtained all the estoppel certificates before closing. Waiting to address minor concerns such as scheduled repairs until after closing could mean putting you on the hook for those items despite the agreement.
Consider Property Condition
Before agreeing to a price on the property, take a good look at the condition of the property. What are you responsible for repairing or replacing? A new HVAC system or parking lot can cost several thousand dollars to do. Make sure to include these added costs into the purchase price. Use the condition of the property as part of your negotiations.